Ready-to-Drink (RTD) Coffee & Tea - Nigeria

The Ready-to-Drink (RTD) Coffee & Tea market in Nigeria has witnessed significant growth in recent years, driven by changing consumer preferences and an expanding middle class.

Customer preferences: Nigerian consumers have increasingly embraced the convenience and variety offered by RTD coffee and tea beverages. The on-the-go nature of these products appeals to busy urban dwellers who are seeking quick and easy refreshment options. Additionally, the younger generation, who are more open to trying new flavors and experiences, has contributed to the growing demand for RTD coffee and tea in Nigeria.

Trends in the market: One notable trend in the RTD coffee and tea market in Nigeria is the increasing popularity of flavored and functional beverages. Consumers are looking for innovative and unique flavors, such as caramel, vanilla, and mocha, to satisfy their taste preferences. Furthermore, there is a rising demand for functional beverages that offer health benefits, such as those enriched with vitamins, antioxidants, and natural ingredients. Another trend in the market is the growing presence of international brands and products. Global players in the RTD coffee and tea industry have recognized the potential of the Nigerian market and have introduced their products to cater to the local demand. This has led to increased competition and a wider range of options for consumers.

Local special circumstances: Nigeria's large and youthful population is a key driver of the RTD coffee and tea market. With a median age of 18. 4 years, the country has a significant number of young consumers who are more open to trying new products and flavors. This demographic factor, coupled with increasing urbanization and a rising middle class, has created a favorable environment for the growth of the RTD coffee and tea market in Nigeria. Furthermore, the Nigerian culture of socializing and gathering in cafes and coffee shops has also contributed to the demand for RTD coffee and tea. These beverages are seen as trendy and fashionable, and consumers enjoy the experience of sipping on a refreshing drink while socializing with friends or colleagues.

Underlying macroeconomic factors: The economic growth and increasing disposable income in Nigeria have played a crucial role in the development of the RTD coffee and tea market. As more consumers have the means to spend on non-essential products, the demand for convenient and indulgent beverages like RTD coffee and tea has grown. Additionally, the expanding middle class has led to a shift in consumer preferences towards premium and higher-quality products, further driving the growth of the market. In conclusion, the RTD coffee and tea market in Nigeria is experiencing significant growth due to changing customer preferences, including a preference for convenience, variety, and unique flavors. The presence of international brands and products, coupled with Nigeria's youthful population and increasing disposable income, has created a favorable environment for the development of this market.

Data coverage:

The data encompasses B2C enterprises. The at-home market covers retail sales via super- and hypermarkets, eCommerce, convenience stores, or similar sales channels. The out-of-home data encompasses all sales to hotels, restaurants, catering, cafés, bars, and similar hospitality service establishments. Combined numbers encompass both the at-home market and the out-of-home market. Both the at-home and the out-of-home market are valued at retail selling prices including all sales and consumption taxes.

Modeling approach:

Market sizes are determined through a Top-Down approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use resources from the Statista platform as well as in-house market research, national statistical offices, international institutions, trade associations, companies, the trade press, and the experience of our analysts. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending (e.g. consumer spending on Non-Alcoholic Drinks, consumer spending at Hotels, Restaurants etc.), and price level index. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing is well suited for forecasting the Non-Alcoholic Drinks market with a projected steady growth. The main drivers are GDP per capita and consumer spending per capita.

Additional notes:

The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. The market is updated twice a year.